I started Zipcar in 2000, armed with three beliefs: people would be willing to share cars instead of owning them because the economics makes sense; a platform leveraging new technologies would make that sharing effortless; and people could be trusted: to pick up and drop off cars without supervision, fill up the gas with a company credit card, and take out the trash when they left.
Zipcar transformed the excess capacity embedded in old inefficient ways of using cars and constructed a platform that enabled the direct participation of our members in the “co-creation” of the new efficient service. This structural triad of excess capacity, platform, peers has been adopted by hundreds (thousands?) of companies since, creating what we now call the collaborative economy. This structure, that I call Peers Inc, elevates and celebrates an asset previously under appreciated: the value of individuals to localize, customize, and specialize products and services according to their unique assets.
The Peers Inc collaboration can be magical, with results that fly in the face of all established business theories, beating the ability of hierarchical and vertically integrated institutions.
Peers Inc companies can scale at exponential rates because they leverage excess capacity (which doesn’t have to be sourced, financed, and built), and they invite individuals (with their diversity of locations and interests) to co-invest. The result? Airbnb offered as many rooms for rent as the largest hotel chain in the world in only four years and Wikipedia’s English edition contains 4.8 million entries.
These companies can also adapt and localize at exponential speeds thanks to the localness and diverse interests of its participants. Witness Yelp and TripAdvisor’s fine-grained reviews of retail in every neighborhood.
And these companies learn at exponential speeds because they make use of the diversity of individual approaches, unearthing and sharing best practices and defusing worst practices. My favorite example: DuoLingo, which offers free online foreign language learning. DuoLingo makes use of the mistakes and successes of its students to hone its instruction, with the result that people learn a semester’s worth of knowledge in just 34 hours instead of 130.
Since Peers Inc companies grow faster, learn faster, and adapt faster, in the future, everything that can become a platform will become one, giving rise to a business environment that works very differently – almost the opposite – to fifteen, or even ten, years ago. Where once, companies succeeded by inducing scarcity and raising barriers through patents, trademarks, copyrights, and certifications, today, the most value is created by opening assets up and maximizing the participation of individuals – to experiment, to localize, to adapt, to innovate.
Peers Inc collaborations change the power balance between owners, consumers and participants. The product, the output of the platform, gains more value with each additional participant. Their very diversity is the source of strength. All of a sudden, we are seeing things that we never thought would be possible. Public goods and currencies can be created without the involvement of governments, community value created without the use of private capital, rules that are enforceable without a centralized force.
All the while, the world suffers from the crises of climate change, sustainability, water scarcity, deforestation, housing, transportation, education, and poverty — all requiring solutions that scale, learn, and adapt quickly if we are to make meaningful change at the pace needed. The collaborative Peers Inc economy is exactly what we need to respond to these urgent problems facing our planet.
We are right this minute rebuilding and restructuring economies with this new paradigm. This means that we have the opportunity to create the world we want to live in. IF we recognize overtly, loudly, powerfully, that the success of this paradigm comes when people are empowered and supported.
Peers Inc is a “together” model. There is a unique role for governments, institutions, and individuals. Large corporations and governments have the power of “Inc,” of creating structures that protect and unleash the creativity of peers. The future of business lies in breaking down the walls between the “Inc” and the “Peers,” in enabling fluid interactions between the institutions and the innovators so that the two powerful ingredients of value creation are fused into one formidable force.
Together we can engage millions of people to accomplish very big things, providing significant public benefits alongside great economic value. It’s not just the owners and creators of the platform who gain: with mindful design of the platforms, we can retain the rule-making governance and ownership within the creator communities. This is indeed a new paradigm: the future of business is about empowering people instead of empowering companies.
It’s time to change the game by creating platforms and sharing power and value with the people who give them life. Together, we have the chance of being the collaborative generation that builds a new economy that doesn’t pit owners against laborers, producers and consumers. Every person can do amazing things when she gets access to the resources she needs to create something of value for society, to be a changemaker. It is sharing that enables, empowers, and unlocks value.
Source: Huffington Post